Saturday, May 02, 2009
Hyperwage Theory is 7 Years Old Today
The idea for Hyperwage Theory came to me sometime in 1995 when I was working among US and British expatriates in Hong Kong and was assigned to several world capitals (New York, London, etc) as a result. The central idea of course is Purchasing Power to the lowest worker. However, at the time, I did not have the full backing of economic principles to back up my discovery. Since then I have read many textbooks and history of economics with the eye of somebody going against conventional economic wisdom. The first time I wrote about Hyperwage Theory (it was not called Hyperwage Theory then) was on May 2, 2002 in my BusinessWorld column. That was the Part 1. Therefore, officially, Hyperwage Theory is 7 years old today. However, part 2 was actually written in 2005 (three years after Part 1). It was in Part 2 that I settled on the name Hyperwage Theory. I actually wanted to call it "High Purchasing Power Theory" but this phrase was too wieldy, too long, too generic, and lacking the originality of an freshly invented word. And people will be referring to it as HPPT Theory? I settled on Hyperwage Theory although this term alone scares away first time readers. I figured, Hyperwage is a controversial term, but, hey, I invented it and its catchy and short. Part 1 by itself is self-contained, it described the theory and principles behind the theory. It should prove to be self-evident. Part 2 and the series was serialized for 33 weeks (whew!) in 2005 and the series was the detailed explanation of the basic tenets mentioned in Part 1. For all intents and purposes, the economic policy makers and the government executives were exposed to Hyperwage Theory in 2005 (four years ago). Hyperwage Theory made the term "purchasing power" fashionable, and I am happy that I achieved my first goal with my theory, and that is "awareness." And you can read so many accounts purporting to debunk Hyperwage Theory but look at their arguments: Do they stand on solid ground or are they just repeating the ideas of the authors of textbooks. And why do Third World people still line up at US embassies looking for that golden visa if not in search of Hyperwage? As long as they cannot answer you that with common sense, don't easily believe those detractors. They are not saying anything new, they are repeating the same economic ideas that have perpetrated and actually worsened the poverty conditions in Thirld World countries. Keep these in mind as your read the articles of the opponents of Hyperwage. (But remember, the government and the politicians have started to catch on: Purchasing Power is not a popular soundbite for them. Isn't that a signal, they are beginning to see the value of Hyperwage Theory?) Now, Hyperwage Theory has become a byword, (the butt of jokes), and Purchasing Power is the economic jargon of the times. Have you heard about "consuming power", "spending powers" "buying power" spoken by the senators, congressmen and economic advisers to the President? Before 2005, purchasing power was hardly a word, they uttered. Now, that they have dipped their feet in the pool, are they ready for US$1.50 per hour (or P20,000 per month) salary for the domestic helpers? Whatsoever you do to the least of your workers, you do unto the economy.